UPDATE 1-Crocodile Gold to start production at Australian mill

Reuters Staff

2 Min Read

* Says to start production at Union Reefs mill on Tuesday

* Says on track to meet FY ‘10 and ‘11 production outlook

* Starts excavation at new Cosmo mine ahead of schedule

May 31 (Reuters) - Canada’s Crocodile Gold Corp CRK.TO said commercial production at its Union Reefs mill in Australia will begin on Tuesday, as target throughput, grades and recoveries are now being met on a consistent basis.

Crocodile Gold, whose mines are located in the Northern Territory of Australia, has also commenced the portal excavation ahead of schedule at its new Cosmo underground mine, with production expected to begin in mid-2011.

“Due to its higher grade, production from Cosmo is expected to assist in lowering the company’s overall operating costs,” Crocodile Gold said in a statement.

The company added it remained on track to produce 100,000 ounces of gold in 2010, increasing to 200,000 ounces in 2011.

Shares of the company closed at C$1.33 Friday on the Toronto Stock Exchange. (Reporting by Arnika Thakur in Bangalore; Editing by Aradhana Aravindan)